ILO Department of Statistics1 ILO experience in quickly estimating the impact of financial crisis on...

ILO Department of Statistics 1

ILO experience in quickly estimating ILO experience in quickly estimating the impact of financial crisis on the impact of financial crisis on

the global labour marketthe global labour market

International Seminar on Timeliness, Methodology and Comparability of Rapid

Estimates of Economic Trends, Ottawa, Canada, 27-29 May 2009


Financial crisis Financial crisis

Affected the economic activities and labour markets around the world;

Urgent need to have accurate and detailed data and information on how the economic crisis impacts employment and unemployment so that appropriate evidence-based policies are developed and monitored;

Developing and developed countries were differently affected by the economic crisis.

Need to come up with global and regional estimates of employment and employment trends


PurposesPurposes Snapshot of the employment situation in the world; Employment evolution through time, analysed in

conjunction with other economic and social variables may be used to draw conclusions about future trends in the global economy;

They provide a benchmark against which the economic and labour market performance of individual countries may be compared and assessed;

Their effect on public policy and the media.


Purpose of this presentationPurpose of this presentation

To describe the ILO methodology for estimating the changes in the current levels and rates of employment and unemployment at the global and regional level– overview of the data availability; – various methods of aggregation at regional and global

levels, various models for imputing the missing values and the types of sensitivity analysis done;

– some of the estimates, and looks at future work that should lead to better and more comprehensive estimates.


Data needed vs. data availableData needed vs. data available

Official monthly/quarterly data on (i) employment, (total, in non-agricultural activities, in manufacturing), total and paid employment; (ii) unemployment (level and rates);

Ideal scenario: (i) available for all countries, (ii) available within a very short time after the and of the reference period and (iii) if all national data were comparable

Reality: very far from ideal.


Aggregation of national dataAggregation of national data

Measurement objective: (i) to measure the overall change in employment/unemployment in the world or (ii) to assess the average change in employment/unemployment across all countries in the world.

Regional groupings : (i) by continent or (ii) by level of development.


Aggregation of national dataAggregation of national data Given (i) the differences in the trends of the changes

between the developed and developing countries, (ii) the limited number of countries with current data (monthly or quarterly),

Considered appropriate (a) to separately analyse developed and developing countries, and (b) to use the weighted median change across countries with data within each group, as a summary statistics for the distribution of these changes

across countries. Global estimates of the changes are calculated as weighted

means of the median changes in the developed and

developing countries.


Alternative aggregations of national dataAlternative aggregations of national data - Average change based on observed and imputed values- Imputations based on the basis of the average month-to-

month change for the last 6 months (geo and arithmetic mean),

Imputed values corrected for the average relative difference between observed and imputed values for countries with data for Jan.2009. (separately for developed and developing countries.)


Alternative aggregations of national data (cont.)Alternative aggregations of national data (cont.) The quality of the estimates based on imputed values

considered as less reliable

1. The situation in the labours market has been changing very quickly and at the beginning of 2009 was much worse than the situation in the second half of 2008, in many countries;

2. The number of points with data in the second half of 2008 was limited to only one or two for countries with quarterly estimates. This makes the imputed values for Jan.09 very unreliable and sensitive to seasonal variations that may exist from one month/quarter to another.


Sensitivity testsSensitivity tests differences between the estimates based on annual and

on monthly data, differences between the medians based on a maximum

number of monthly/quarterly observations and on observations for two thirds of the series,

upper and lower limits of the median when the values for countries without data are imputed.

Additional tests were done by imputing the values for China and India based on the annual change in employment/

unemployment.


Sensitivity tests - findingsSensitivity tests - findings The global estimates based on the median for the

countries with data are very similar to the ones based on data for all countries.

The quality and reliability of the global estimates depend on the number of countries with data.

The global estimates are for the last two months should be interpreted with caution.

Given the large number of developing countries without data, especially China and India, the estimates for the developing countries should be interpreted with caution.


Some resultsSome results

Global and regional trends estimated for unemployment (level and rate); employment total, total and paid employment in non-agriculture, total and paid; employment in manufacturing, total and paid. CPI (all-items and food group).

www.ilo.org/jobcrisis.


Some results:Some results:Percentage change over the same period of the Percentage change over the same period of the

previous yearprevious year

Developed countries

-20.0

-10.0

0.0

10.0

20.0

30.0

40.0

50.0

CPI: All items CPI: Food Unemployment Employment Employment in manufacturing

Developing countries

-10.0

-5.0

0.0

5.0

10.0

15.0

20.0

CPI: All items CPI: Food Unemployment Employment Employment in manufacturing


ChallengesChallenges

To improve the methodology for estimating (i) the changes in absolute level of employment and

unemployment,

(ii) the number of jobs lost.

Based on the experiences with previous crisis, to predict the changes in the future.

To analyse the impact of crisis on the situation of men and women in the labour markets.

ILO Department of Statistics1 ILO experience in quickly estimating the impact of financial crisis on...

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